Michael Saylors Strategy (MSTR) will not need to sell any portion of its Bitcoin assets to cover debt during the next big crypto market decline, according to Bitcoin analyst Willy Wu.
“Will MSTR be liquidated in the next bear market? I doubt it,” Willy Wu said in an X post on Wednesday.
Strategy’s debt consists primarily of convertible bonds. Once the conversion date arrives, Strategy plans to settle the conversion by paying cash, common stock, or a combination of both at the time of the election.
A safe strategy that won’t liquidate during the next bear market
For shareholders with a vesting date of September 15, 2027, Strategy will have approximately $1.01 billion in debt. To avoid having to sell Bitcoin (BTC) to make the repayments, Wu said Strategy’s stock needs to trade above $183.19.
This price roughly corresponds to the Bitcoin price of approximately $91,502, assuming a multiple net asset value (mNAV) of 1, he added.
sauce: Willy Woo
Bitcoin analyst The Bitcoin Therapist said that “Bitcoin’s performance would have to be terrible” for Strategy to have to start selling Bitcoin during the next market downturn.
“If we see a liquidation of Strategy, we will continue to see a severe bear market,” they added. According to Saylor Tracker, Strategy holds approximately 641,205 Bitcoins, which is worth approximately $64 billion at the time of publication.
Strategy shares closed Tuesday at a seven-month low, dropping nearly 6.7% on the day to $246.99. Meanwhile, Bitcoin is trading at $101,377, down 9.92% over the past seven days, according to CoinMarketCap.
Wu hints at possibility of ‘partial liquidation’
Wu does not expect a liquidation to occur during the next bear market, but warned that it could happen if Bitcoin does not rise significantly during the expected 2028 bull market.
“Ironically, if BTC does not rise in value fast enough during the envisioned 2028 bull market, it could be partially liquidated,” Willy Wu said.
Some crypto executives, including ARK Invest CEO Cathie Wood and Coinbase CEO Brian Armstrong, predict that Bitcoin will reach $1 million by 2030.
